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Without knowledge of an estate, an estate plan can be complicated

People may know they need an estate plan, but that can mean different things to different people. Anyone in Michigan who attempts to create an estate plan will need to understand what their estate actually entails. It is then important to understand what one's wishes are and how to make that happen efficiently and cost-effectively.

A person must first and foremost understand what their estate includes. A good place to start is to outline a person's net worth. It can be very difficult to divvy up wealth without understanding what kind of assets actually exist. Net worth is determined by taking the worth of assets and subtracting any liabilities, which is all debts. Appraisals of assets may be necessary to conduct this important step.

Potential pitfalls of not making an estate plan

No one likes to think about needing an estate plan. An estate plan essentially forces a person or family to think about their mortality or the mortality of a loved one. However, not planning accordingly or not being prepared can be costly to loved ones and can also leave more work and cost more money for those who have to deal with the aftermath of an ill-prepared or incomplete estate plan. Anyone in Michigan who has not thought outside of the box when it comes to an estate plan may benefit by stopping and doing so.

A lot of people do decide to create a will and outline the basics of who gets what. Yet, many of those people may not take any time to revisit that estate plan. Beneficiaries can be blindsided or shocked to see that a plan that might have been relevant 20 years earlier only leads to family strife because it was never updated. People divorce, more children are born and children and parents sometimes develop strained or complicated relationships. Not updating a plan to accommodate these changes can be devastating and unfair to those left behind.

Creating an estate plan isn't just for the elderly

When people think about estate planning, they may automatically assume it is a concern for those who are of a certain age and lot in life. However, there is never an age that is too young to think about an estate plan and ensure that the process is handled correctly. Anyone, especially those in their 30s in Michigan, who owns a home, has a family or has any kind of assets should act to protect themselves and their loved ones.

There are certain documents the 30-something generation should create as soon as possible. One is a will. A will is necessary to protect assets and can outline who will administer an estate. More importantly, a will can also outline who will act as a guardian to minor children.

Michigan residents may want to consider a trust fund

Michigan residents who are looking to begin the estate-planning process may be a bit overwhelmed by the different documents that they may be able to set up. Many individuals are aware of how a will works and may believe that this document is the most important one. While individuals should not rule out making a will, they may also want to consider other documents and accounts as well, such as a trust.

Trusts and wills have similar purposes, in that they disclose what should happen with certain assets after a person's passing. However, a trust does not have to follow the same legal processes that a will does when it comes to distributing the assets. Parties named in a trust may be able to more quickly receive what they have been bequeathed due to the process not having to be court supervised.

What questions should I ask my real estate agent?

Whenever a Michigan resident plans to engage in purchases and sales of real estate property it is wise to go over a few important questions with one's real estate agent. Not all real estate agents will cross all their t's and dot all their i's, and not all real estate agents are entirely ethical and competent. However, by staying on the ball, those planning purchases and sales of real estate can ensure that agents are doing their jobs and avoid any potential problems down the road.

It could happen that a seller of real estate might incorrectly believe that he or she has contracted a seller's agent, when in fact the agent is representing the buyer in the deal. It is therefore important to confirm who your real estate agent is actually representing, and make sure that it is you. It is also good to be aware of how long your real estate agent has been licensed. An experienced agent with years of transactions under his or her belt could be better suited to represent you in your dealings. While this may not be a ‘make it or break it' issue for all real estate purchases and sales, it is good to know the background and experience of your agent.

College Savings accounts a good estate plan option

Parents and grandparents are always looking to make preparations for providing for the next generation. One of the most pertinent concerns families in Michigan have is saving for college for their children and grandchildren. A parent or grandparent may want to consider incorporating a 529 college savings account in his or her estate plan in order to begin saving for the education of the next generation while also avoiding tax liabilities.

These types of accounts allow for earnings to accumulate freely without having to be counted for federal income tax purposes. The beneficiary of the account will be allowed to withdraw funds from the account tax free once hitting college age. However, the withdrawals can only be used to pay for qualified college expenses. Although usually these accounts are created for the benefit of one's family, familial relationships are not required to name somebody a beneficiary to a 529 college savings account.

Michigan city votes to reduce number of adults allowed in rentals

An ordinance specifying the number of adults who can live in one rental unit was finally approved by the City Council of Holland, Michigan, after much debate. The ordinance was passed on Oct. 1 in a 7-2 vote and reduces the number of adults who can live in a rental home or apartment unit from six to four.

The original debate surrounding the ordinance came from the fact that there was no grandfather clause with the original proposal. A grandfathering provision was added to the ordinance, allowing landlords who had rental units with up to six people currently occupying as of Sept. 1 to be exempt from the four-person maximum. Those landlords must notify the Department of Community and Neighborhood Services by the end of the year to qualify, and if a housing permit is allowed to expire or is revoke, the grandfather provision is not applicable.

What to do when a tenant violates a lease

Dealing with a noncompliant tenant can be challenging for any landlord, but the stakes are often higher in commercial rentals. Commercial rentals can be harder to find tenants for, and moving one tenant out and another in is a much bigger process than with residential rentals. Because of the larger rent amounts, having an empty unit can create serious financial stress on the property management company while waiting for a new tenant.

Despite these complications, it is important to ensure that tenants understand the terms of their leases and act accordingly. When a tenant is in violation of the lease, there are several options. A good first step is to send a letter or other type of written communication to the tenant, letting the appropriate person know about the lease violation and the possible consequences as spelled out in the lease.

Pets or no pets? The dog days of residential real estate rental

A lot of Michigan landlords are afraid of letting their tenants have pets in the residential real estate properties they rent. However, some individuals argue that letting pets in a residence may not actually be a bad thing. In fact, one landlord recently made some poignant comments about a strange policy he successfully maintained, which required all of his renters to own dogs.

The landlord said that he is a dog lover himself, and he knows how hard it is for individuals to find residential real estate to rent that allows them to have dogs. He decided to make it a requirement for everyone that stayed in his properties to be a dog-owner.

An estate plan can entail a number of documents in Michigan

When it comes time to think about how to handle the estate-planning process, there may be more than meets the eye. Each person's estate plan can be vastly different than another person's. Anyone in Michigan who is in the beginning stages of the estate plan process may want to be clear about the differences between documents and the facts about which document may be best for which situation.

Over the years, people have been advised to view creation of a trust as preferable to creating a will. A trust gives a person the power to transfer assets and funds during their lifetime rather than when that person passes on. If a will is chosen, the probate process can take some time, but some say the downside of a will and probate in general is being exaggerated. Anyone choosing between a will and a trust may want to discover which one is best for his or her particular situation.

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